1 What are the boundaries of a firm 2 What determines the ex

1. What are the “boundaries” of a firm?

2. What determines the extent of vertical boundaries?

3.What determines the extent of horizontal integration?

4.Use a cost-benefit analysis to describe the optimal boundaries of a firm.

please provide any websites used for reference. thank you

Solution

1. The boundaries of a firm defines a well defined structure of a company\'s financial condition. The transactions taking place in a company is observed.

2. The vertical boundaries is detemined by group administration which is team work. It depends upon the top to bottom management of the department.

3. The horizontal boundaries is determined by managers of the departments. They allocate work to people as per their abilities.

4. The cost-benefit analysis describes the optimal boundaries of a firm by proper investment in a firm. It involves proper risk benefit analysis and cost-effectiveness

reference

http://www.columbia.edu/itc/sipa/u8213-03/packet/bengt-300.pdf